California continues to see pressure.
After three consecutive months of improvement, the California cannabis market slowed in June. June cannabis sales were $431M compared to $442M in the previous month. That accounts for an MoM decline of 2% and a YoY decline of 5%. It's not all bad when you consider that March YoY comparisons were down 11%, April down 12%, and May down 8%. California will continue to see easing comps for the coming months when it troughs in September. This mature market has just recently seen price normalization after a year of price deterioration. We are currently seeing the price deterioration story in most legal markets in the U.S. and Canada, with California at the end of that story.
M.A. approves industry reform.
Yesterday morning, lawmakers in Massachusetts approved a package of changes to the state's cannabis industry. The bill would reduce steep fees charged to operators, allocate 15% of state recreational cannabis tax revenue into a fund for disenfranchised entrepreneurs, make the expulsion of cannabis convictions easier, and allow a cannabis café pilot program. All that is needed for this bill to become a reality is the signature of Governor Baker. "We applaud the conference committee for long-awaited passing reform of the onerous fees that municipalities have been extorting from small cannabis businesses for the past five years," said David O'Brien, the president of M.A. Cannabis Business Association. "This change will finally send a clear message to municipalities: It's time to show the receipts."
Is Booker open to compromise?
The Cannabis ETF MSOS is down 55% YTD and 25% over the last three months. Over the last month, it has risen 10% but needs to go up 104% to get back to where it was on Jan 1. Nobody is buying Booker's pivot on SAFE!
Senator Cory Booker, who has been a cannabis activist and is one of the sponsors of Senate Majority Leader Chuck Schumer's CAOA bill, said yesterday that he would be "open to compromise" and would consider passing a cannabis banking reform bill which includes a social equity component to it before tackling a complete U.S. cannabis reform. "I'm open to compromises that are going to achieve my goals of safety, of investment opportunities that are equal for business communities, and, finally, to make sure we do something for all of these people right now who have marijuana possession charges that deserve some relief from the impact that it's having on their economic and family wellbeing," the senator said. Senator Booker also said that SAFE Banking is a very important bill that he supports but continues to press that including some social justice language is essential.
